The gains and losses of Baozou Comics: From a valuation of 4 billion to being "disbanded"

On September 6, 2019, Baozou Comics held a funeral for its editor-in-chief and the company's Internet celebrity leader, Wang Nima. In the video, Wang Nima's headgear sat alone in the middle of flowers and photo frames, and "two thousand" employees dressed in black expressed their sorrow to the background music of "Today is a Good Day". This is the last episode of the sixth season of "Big Events", which is a spoof, a mix-up, and a "powerful lineup", very Baozou Comics.

From the launch of the comic community to its suspension, in the past 11 years, Baozou Comics has been the youth memory of some people. It has also been questioned a lot until it fell into crisis.

It is disguised as an MCN, using the model of incubating character IP with content, and then using people to bring new products. It is closer to money, flexible and difficult to control.

Success depends on this set of rules, and failure also depends on this set of rules.

1. “People-oriented” IP brokerage company

What kind of company is Rage Comics?

The answers include comics, animation, MCN and even game companies, etc. However, in the eyes of some fans, since the formation of Baozou Big Event in 2013, it has been an agency company that uses MCN and online variety shows as a cover and focuses on incubating Internet celebrities and IPs.

It started with a UGC community, accumulated original users, expanded through various popular online entertainment content formats, and eventually grew into an Internet celebrity factory with an estimated value of 4 billion, and then used existing people and program IPs to expand and monetize its products.

Rage Comics Financing Records

This model is closer to money, has many changes, and is easily favored by capital, but it also requires extremely high levels of personnel management, content control capabilities, and a mature business system to support it.

The decline of Baoman lies in the fact that it did not have enough support in the process of implementing this model, and it did not carry it through to the end.

2. UGC community starts, destined to be active and disorderly

The earliest Baozou Comics was an almost disordered UGC comic creation community, which may have determined that it was destined to be active, explosive and disorderly in its genes.

It was founded in 2008 by Wang Nima using North American Rage Comic materials, product logic and a self-developed comic editor. Users can use the materials for free to create and share short comics.

Rage Comic materials provided by early Rage Comics

Taking advantage of the general users' personalized and social needs, as well as the "connotation" trend formed by the Diba and WOW bars at the time, the official website of Baozou Comics and its crude, bug-ridden client quickly attracted a large number of users between 2008 and 2010 (some sources say that the number was over 3 million in 2009, but this cannot be verified). However, the community itself did not have a mature profit-making idea, nor could it judge users' willingness to pay.

So in 2010, community organizer Wang Nima and professional businessman Ren Jian met and founded Xi'an Momo Information Technology Co., Ltd., whose business scope mainly includes artist brokerage, radio and television program production, cultural and artistic event organization, daily necessities development, animation and game development and distribution, etc.

According to Baoman’s early employees, since 2010, Baoman’s development positioning has no longer been community and tool. They hope to use that group of young users with a strong desire to express themselves to do more things, find a backbone, and expand the entire online entertainment content industry around it.

With this vague idea in mind, Baoman launched the series of "Brainless Dialogues" in 2012 to increase the frequency of sharing and brand exposure, attract more users, and at the same time push the mainstay, KOL/Internet celebrity Wang Nima, to the forefront. It also began to shift its business focus from the comics community to online variety shows, imitating Good News to create a series of talk shows that could output opinions. By 2013, the show was officially renamed "Baozou Big Events".

Early "Baozou Big Event", obvious imitation

Relying on its user resources and ideas with long-term development potential, Baoman also received A and B rounds of financing totaling several million and tens of millions of yuan from Shanda Capital and Innovation Works in 2012 and 2013.

After the completion of the B round of financing, CEO Ren Jian officially announced that both rounds of financing would be mainly used for investment in content and IP creation. There were no clear changes in company management, business cooperation with artists and writers, and community management, and they remained in their original state.

According to the writers and actors who participated in the creation of "Baozou Big Event" in 2013, the cooperation at that time was extremely "humanistic", mainly based on verbal agreements, and did not even require contracts and legal intervention.

At the same time, Baoman launched the slogan "Children should not watch Baoman", which was used to segment users on the one hand, and on the other hand, it actually implied that the programs and communities contained light violence and pornographic content in order to "attract customers".

This led to most early creators and audiences not being aware of the content red lines, and a considerable part of the connection between programs and IPs was based on "high-risk" content and viewpoints. These were all hidden dangers, but the company did not make any changes for quite a long time.

This active, explosive but disordered gene destined Baoman to rise in the following years and then decline after its peak.

3. Use programs to bring people, and then use people to bring programs

After the B round of financing, Baoman began to devote itself to the incubation of Internet celebrities and new program IPs.

2012-2016 broadcast schedule

During 2013-2014, Baozou Comics successively established Shanghai Baozou Information Technology Co., Ltd. and Beijing branch, and launched Daily Baozou, Baozou Watch Movies, Editorial Department Stories, Baozou Horror Stories, and several "Prank Series" mobile games.

Some Rampage games

As of September 2014, the company had received tens of millions of dollars in Series C investment. In addition to Wang Nima, programs such as "Baozou Big Event" and "Baozou Kanshenpian" have created many internet celebrities such as Tang Maru, Zhang Quandan, and Zhijin. Among them, Tang Maru and Zhang Quandan are able to receive invitations to advertisements and commercial performances, and the fee for a single appearance is reportedly nearly hundreds of thousands of yuan.

At this time, the sponsorship of "Baozou Big Event" has changed from a single episode sponsorship by a small brand to an exclusive sponsorship of the entire season by a large brand + a single episode advertisement. While cultivating new IPs such as Ahua and Captain, it also used the images of various Internet celebrities to create a number of programs such as "Baozou Small Classroom", "Brainless Senior Brother", "Baozou Lu Alu", and "Baozou MC".

It can be said that by the end of 2014, Baozou Comics had already figured out the idea of ​​using TV shows to create Internet celebrity IPs and then using Internet celebrity IPs to bring new products. In order to expand the resource pool formed by this model and find more monetization opportunities, they began to expand more rapidly.

Since 2015, Baozou Comics has started to add talk show-style variety shows in sub-categories in addition to its flagship program "Baozou Big Events", such as Wang Nimei Express, Baozou What Ghost, Baozou What Game to Play, etc. At the same time, Beijing Baozou Culture Development Co., Ltd. and Baozou Films were established, and several animation and comics companies were invested.

Outbound investment in 2015 and 2016

Because Baoman's IP is people-centered, there are more flexible forms of business cooperation and a shorter payback period. A well-established Internet celebrity image can directly generate profits for the company through advertising, TV shows, endorsements, and filming TV dramas, and it does not have to bear the pressure of production costs and cycles like animation and film IP.

This concentrated explosion of multiple Internet celebrities and multi-field products brought Baoman to the peak of its entrepreneurial career from 2016 to 2017: the number of downloads of its apps exceeded 40 million, the number of fans exceeded 100 million, and "Baozou Big Event" set a record for the highest monthly income for members of Youku's revenue-generating platform. The company itself also completed a D round of financing of tens of millions of yuan in August 2017, with a valuation of over 4 billion yuan.

After its glory, the disordered genes that had previously helped it expand finally came to collect their debts.

4. Collective loss of control of any content

Due to the disorder in management and content control, Baoman has entered a stage of chronic problems since 2018.

First of all, this "people-oriented" IP agency first experienced the uncontrollability of people.

According to former Baoman employees, the company entered a rapid development phase in 2015, with a surge in the number of employees, partners, and customers, but internal management remained lax, with unclear division of labor, inadequate responsibility, and contract disputes frequently occurring. This led to a surge in the company's employee turnover rate between 2016 and 2018, with many important positions being filled by fresh graduates or outsiders, except for the core creative team.

This situation led to the loss of some resources, and also affected the unity within the company and the normal creation and profit of several programs. Later, "because the overall benefits were still soaring, the leaders didn't pay much attention to these things."

By 2018, the disorder had finally gotten out of control.

In May 2018, because of a spoof of national heroes in the program, "Baozou Big Event" was forced to be removed from the shelves for rectification. Although it was renamed and put online later, the sudden adjustment of the content direction caused a very unnatural change in the overall tone of the program.

The re-listed "Big Event" is only uploaded and played on Bilibili as an UP host, and other platforms have blocked searches

The original "Big News" which was "loud-mouthed" and "unruly" and used satire and humor to convey values ​​has become conservative, and a new variety show with a strict requirement of "positive energy content" has made a group of original users who are used to watching borderline content and believe that spoofs are innocent feel uncomfortable.

According to the business staff of Baozou Dashijian, after the show was removed from the air for "insulting national heroes" and then re-broadcast, the number of sponsors, audience and quality of the show all dropped significantly. This incident also completely triggered conflicts within the creative team and the company. In the few months of suspension, there was a major turnover of talent in content production and business, and the direction of the content was difficult to determine. Compared with money, the loss of people and content may be a hidden danger that the next season of "Dashijian" may fail to meet the deadline.

In August, the contract dispute involving actor Li Di (Tang Maru) once again provoked a conflict between Baoman and the internet celebrity IPs it had incubated. Compared with ordinary employees who could be quickly replaced with high salaries and corporate brands, the loss of mature character IPs that had already been cultivated with resources was more difficult to deal with.

Tang Maru's Weibo

According to Tang Maru, in the past few years, there have been problems with the contracts signed between Baozou Comics and actors, such as lax contracts, breach of contract, and squeezed profits and wages. Starting from 2018, Tang Maru, the porn appraiser and excrement-pulling youth in Baozou World, will no longer exist, and actor Li Di will re-enter the entertainment industry as a personal actor.

In the same month, Ren Jian, CEO of Baozou Manhua, also made an explanation on the social platform, but did not discuss the details of the business cooperation, only saying that starting a business is not easy.

In fact, the model of Baozou Comics is indeed not easy. Human-based IP incubation and operation can be accepted by users faster than digital products, with lower costs and faster and more flexible money-making. However, except for Wang Nima who can be replaced by dubbing software and people with similar body shapes, other characters such as Tang Maru, Zhang Quandan, Ahua, and the captain are not replaceable "company property" in the strict sense.

When this group of IPs choose to permanently leave the Baozou Comics world because they are not comfortable with the management and profit-sharing system, in today's world of anchors, Vlogs, and new internet celebrities, can the Baozou Comics model still create a new Tang Maru and achieve rapid replacement and regeneration? This is a difficult question to judge.

Perhaps Baoman itself has also realized the bottleneck of this model. Since 2015, when it began to focus on investing in animation CPs, they have been trying to transform their business beyond the original model.

Among them, "Next Gen" ("Go! Amnesiac") received investment from Wanda and Alibaba in May 2018, and was jointly distributed in China by the two giants. The overseas distribution rights of the film (English name: Next Gen) were also purchased by streaming giant Netflix for US$30 million (about RMB 180 million).

However, due to changes in brand reputation and limitations on production and distribution capabilities after the May incident, the film's box office has only been a dismal 16.84 million yuan since its release in late July.

At the same time, another theme movie product of Baozou Manhua, "Baozou Manhua's Daydream", is expected to be released in 2020.

If Baozou Comics cannot find a new way out in the more than one year since Wang Nima's "death", then this daydream may just be a daydream.